Publishers Are Now Suddenly Begging Advertisers to “Pledge” 25% of Advertising Budgets

An open letter suggests that publishers are now resorting to begging advertisers to keep shovelling money their way.

Things have not gone well for Bill C-18 supporters. It was very predictable that things would go down this way, but the constant demonizing and barrage of personal attacks of critics making reasonable arguments in this debate was certainly testing a lot of people’s patience.

Throughout the debate, Bill C-18 supporters have been trying to insist that platforms are beholden to Canadian news. Whether it is through cherry picking data, accusing critics of being bought and paid for shills of “Big Tech”, or dismissing/ignoring all the evidence put forward by critics of the legislation, it seemed to be a constant barrage of disinformation meant to convince everyone – including themselves – that they will automatically come out on top because reasons. All you need to do was believe hard enough and a sprinkling of magical thinking and pixie dust will magically solve everything.

In the supporters minds, because platforms depend almost exclusively on news content, there is no way that they would drop news links altogether. So, as a result, it was all just a big fancy bluff. Those platforms will come crawling back to them and negotiate “deals” because there is no content out there on the internet other than news content. Without their news content, the platforms would just fold as a business overnight because no one would be able to post anything at all. So, really, for supporters, they are the ones in control of the situation and all that is needed was a little time for platforms to just ‘come to their senses’.

Of course, reality is having none of it so far. The US doesn’t want to intervene, the advertising boycotts have failed on both fronts, and rallying Canadians by comparing this fight to World War II didn’t resonate with Canadians.

The government, for it’s part, capitulated by offering “clarifying” language which essentially heavily watered down the bill after it became law. This in a desperate attempt to bring the platforms back. The effort has already partly failed when Meta rejected this effort. We are still waiting for Google’s response to this, but this is already looking like a bad trend.

All of this raises a pretty obvious question: how does any of this sound like the publishers are in control of the situation?

Of course, like a dealer high on their own supply, the publishers are continuing to insist that although there were some minor issues, the situation is not all that bad. So, really, the latest move by publishers to pretty please beg their advertisers to stick around oh please oh please oh please just trying to, you know, uh, “make an impact”, yeah, that’s the ticket! Make an impact! From Global News:

Canadian local news providers are set to take a revenue hit amid fallout from Ottawa’s Bill C-18, the head of a national media group warns in a letter to advertisers urging dedicated spending to support smaller players.

The passage of Bill C-18, dubbed the Online News Act, was met with swift retaliation from tech giants Meta and Alphabet in June.

The move will not only result in a loss of potential revenues that Bill C-18 wants to force the platforms to pay to media organizations, but will also curtail traffic to news organizations’ content.

But in an open letter to advertisers and other stakeholders in the Canadian media industry, Shannon Lewis, the president of the Canadian Media Directors’ Council (CMDC), argues that leaders in the sector can make an impact “independent” of both Ottawa’s legislation and big tech’s ambitions.

The letter published Tuesday calls for media and advertising companies to pledge spending 25 per cent of their online digital marketing budgets through local media. Spending one of every four advertising dollars on local media would work out to $380 million in support for local Canadian journalism, according to Lewis, which she said would eclipse revenue estimates tied to Bill C-18.

The letter itself read, in part, as follows:

Dear leaders in the media, marketing and advertising industry,

As the president of the CMDC, I am reaching out to you today, urging you to support our shared cause of protecting and strengthening local news in Canada.

Your leadership and actions are crucial, and together we can make a significant impact.

Imagine your morning without local news, a reality where information is scarce and updates on events shaping our communities are non-existent. In the absence of reliable news sources, rumors and misinformation spreads. The truth becomes elusive, and critical thinking takes a backseat. The bonds that tie our society together weaken, and we all know where that leads. We are closer to this than we realize, and we must act now to prevent it from becoming our future.

The news landscape in Canada is facing unprecedented challenges, with a continuing decline in investment towards Canadian news media publications. In 2014, 23.1% of media investment supported Canadian and local news media – within five years, that dropped to a mere 5.7%. In the last 15 years, we’ve lost 473 local news operations across 335 communities.

However, we believe a solution is within reach. As representatives of the Canadian Media sector, we are committed to supporting local journalism through our Canadian Media Manifesto. We are asking agencies and marketing leaders to pledge 25% of their total digital advertising investment towards local media. This would mean $380 million in new revenue for local media. It’s more money than Bill C-18 is projected to provide to news organizations, and it will be achieved through industry collaboration.

With the seemingly eventual news links blocks on Meta and Google, this is a really big ask. The larger publishing organizations are about to lose considerable reach because they would no longer have access to the large platforms of Facebook, Instagram, and Google. As a result, advertising with them is going to become an increasingly big ask because there is only a limited number of people that they are able to reach afterwards. So, begging for a dramatic increase in advertising revenue is basically asking that advertisers fork over money as a charity, rather than as a means of growing their respective businesses.

There’s huge problems associated with that. The economics of running a business these days is still tough and businesses are eager to increase their customer base. With inflation remaining stubbornly high, the stock markets still in a massive yo-yo swings, extremely high interest rates eating away at consumer budgets, asking advertisers to just throw money towards a charitable effort instead of trying to retain customers is a really big ask.

To be fair, some businesses out there might go along with this and increase budgets for local news businesses. However, this effort is going to run into increased resistance with the economic realities of today. Would you rather use the massive platforms for your advertising efforts to reach a huge and growing portion of the population or would you just throw that money towards what sounds like a good cause and get a limited reach with your advertising dollars? It’s a really tough sell from a general perspective.

If we really want to be realistic about the situation, the desperation in the media sector is creeping into the territory of full blown panic at this point in time. They are seeing the writing on the wall and as developments keep not going into their favour, the more the hard reality finally sets in. That reality, of course, being that this is an entirely self-inflicted situation and that platforms are about to choke off vital traffic and audience to the publishers – a traffic flow that many of the publishers actively depend on. Despite trying desperately to put a positive spin on it, this is just the media going into full blown panic mode.

Drew Wilson on Twitter: @icecube85 and Facebook.

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